Correlation Between Haima Automobile and Tengda Construction
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By analyzing existing cross correlation between Haima Automobile Group and Tengda Construction Group, you can compare the effects of market volatilities on Haima Automobile and Tengda Construction and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Haima Automobile with a short position of Tengda Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haima Automobile and Tengda Construction.
Diversification Opportunities for Haima Automobile and Tengda Construction
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Haima and Tengda is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Haima Automobile Group and Tengda Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tengda Construction and Haima Automobile is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Haima Automobile Group are associated (or correlated) with Tengda Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tengda Construction has no effect on the direction of Haima Automobile i.e., Haima Automobile and Tengda Construction go up and down completely randomly.
Pair Corralation between Haima Automobile and Tengda Construction
Assuming the 90 days trading horizon Haima Automobile Group is expected to generate 1.99 times more return on investment than Tengda Construction. However, Haima Automobile is 1.99 times more volatile than Tengda Construction Group. It trades about 0.01 of its potential returns per unit of risk. Tengda Construction Group is currently generating about 0.0 per unit of risk. If you would invest 530.00 in Haima Automobile Group on September 4, 2024 and sell it today you would lose (35.00) from holding Haima Automobile Group or give up 6.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haima Automobile Group vs. Tengda Construction Group
Performance |
| Timeline |
| Haima Automobile |
| Tengda Construction |
Haima Automobile and Tengda Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haima Automobile and Tengda Construction
The main advantage of trading using opposite Haima Automobile and Tengda Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haima Automobile position performs unexpectedly, Tengda Construction can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Tengda Construction will offset losses from the drop in Tengda Construction's long position.| Haima Automobile vs. Industrial and Commercial | Haima Automobile vs. China Construction Bank | Haima Automobile vs. Agricultural Bank of | Haima Automobile vs. Bank of China |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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